That was the question many investors asked Thursday morning when whispers -- reminiscent of those heard during the euro zone debt crisis -- swept across the U.S. and Europe. Many scratched their heads as this small Portuguese bank sent stocks into a tailspin, IPOs into delay and investors seeking the safety of gold and government bonds.

Before it was abruptly suspended from trading, Banco Espirito Santo was the largest listed Portuguese bank but its market cap is only $3.7 billion. That’s about the same size as popular companies
Hyundai Motor, L’Occitane and
McDonald's. In other words, global markets were brought to their knees by your mom’s minivan, tiny fancy soaps or 10-piece McNuggets.

When Espirito Santo International, which has an indirect stake in BES, delayed coupon payments on short term debt, reports of financial irregularities surfaced. Following a resultant drop of global stock prices and a whirlwind of media coverage, Moody’s Investors Service and Standard & Poor’s Rating Services downgraded the bank’s ratings on Friday.

Sterne Agee analyst Carter Worth doesn’t understand why Banco Espirito Santo has gripped the fears of so many investors when bank performance in Europe has been dropping for months. He notes that shares of Deustche Bank, which is over ten times as large as BES, have plummeted 22% year-to-date while Credit Suisse, which dwarfs BES with a market cap of $44.5 billion, is down 6%.

In Worth’s opinion, the importance of the week’s market movements is greater than Banco Espirito Santo and wondered whether any data point could have sparked the same market movements. The key lesson is that consumer sentiment is extremely sensitive and vulnerable, he says.

“It’s all just a joke. They might have trillions of exposure but the point is that it can’t be serious,” he said in a phone interview Thursday. “It could just be sentiment is a fickle thing.”

In a report released Thursday,
Barclaysanalyst Antonio Pascual echoed Worth’s sentiment, saying the Banco Espirito Santo saga doesn’t carry as much threat people may think. In fact, he thinks the Portuguese government has more than enough cash set aside for bank recapitalization and expects economic activity in Portugal to grow 1% this year, suggesting that the damage caused by Thursday’s events is mainly reputational.

Thursday, BES did in fact reveal it has 1.18 billion euros (or $1.6 billion) in exposure to related companies in a last-ditch attempt to soothe investors’ stresses.

“Whether it’s the Federal Reserve Chairman saying inflation will go up or
Starbucks announcing it may close all their stores in Europe, sentiment shifts on a dime,” Worth noted, explaining the panic using hypothetical scenarios. “People will seize on anything to reduce exposure,” he said.

According to Worth, the totality of world events – not the latest out of Portugal – has led to the sluggish markets and an asymmetrical risk reward. In other words, investors haven’t been paid for taking certain risks. Today, a January investment in the Russell 2000 would have basically no return, yet at one point the index was down 11%. Entering at the wrong time could mean you endure all of the risk, but with no gain.

Since Banco Espirito Santo’s “serious financial condition” made headlines on Thursday, global markets have lost some ground but are inching back into the green with stock markets ending the day in Portugal up 0.62%, Italy 0.6% and major US indices between 0.15% and 0.44%.